Amendments on the Law on Excise Duty in Bosnia and Herzegovina related to tobacco products

Tax Alert, July 2014

Amendments on the Law on Excise Duties in B&H, which was published in the „Official Gazette of B&H“, number: 49/14, entered into force on 2nd July 2014 and will be applicable as of 1st August 2014.

This amendments prescribe the obligation for taxpayers and other persons involved in sale of cigars, cigarillos and smoking tobacco to create inventory lists of the respective tobacco products as on 1st August 2014 and submit them to the Indirect Taxation Authority of B&H (hereinafter: „ITA“) until 8th August 2014.

In addition, all persons involved in sale of cigars, cigarillos and smoking tobacco are obliged to report new retail selling prices of such products, to calculate and pay the excise difference until 8th August 2014.

The difference between excise duty earlier paid and excise duty newly calculated shall be paid within 10 days as of the day the inventory lists were submitted to the ITA.

Those tobacco products for which the excise difference was paid can be sold by applying new retail selling prices until their stock is exhausted. New retail selling prices shall visibly be placed within the retail store.
The excise on cigars and cigarillos for 2014 was not amended. However, the excise on smoking tobacco for 2014 now amounts 78 BAM/kg.

For simplification purposes for excise duty calculation, you may use calculation tables from the website of the ITA: http://www.uino.gov.ba/b/.

We would like to draw you attention to the fact that the total maximum excise burden of the most popular price category of cigarettes which amounted 126.00 BAM for 1,000 cigarettes was increased to 176.00 BAM of the total maximum excise burden of cigarettes with the lowest retail selling price. Yearly dynamics of increasing the special excise duty for cigarettes remains unchanged.

As of 2015, excise duty on smoking tobacco will amount at least 80% of the minimum excise duty payable for 1,000 cigarettes. Excise duty on smoking tobacco shall be established by the Governing Board of the ITA on 30th October within the current year for the year following year.

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